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The Doc Fix

December 13, 2013

Law Firm: McDonald Hopkins LLC - Cleveland Office

This week, Senate Finance Committee Chair Max Baucus (D-MT) said his committee will consider so-called "doc fix" legislation to repeal the rate formula used for physician reimbursement under Medicare. Baucus sent out a notice to fellow committee members announcing they will meet in "open executive session" on Dec. 12 "to consider an original bill to repeal what is officially known as the Medicare Sustainable Growth Rate (SGR) formula."

The legislation that Baucus will offer will be distributed 48 hours before the start of that meeting.

However, there remains significant stumbling blocks to any major overhaul of the doc fix—including how to pay for it—even as bipartisan support for repeal has gained momentum.

Unless Congress acts by Jan. 1 in some manner, Medicare physician payments will be cut by about 24.4 percent.

On Oct. 31, Baucus and Finance Committee ranking member Orrin Hatch (R-UT)—joined by House Ways and Means Chairman Dave Camp (R-MI) and that panel's top Democrat, Rep. Sander Levin (D-MI)—released a "discussion draft outline" on permanently fixing the SGR. That draft called for a SGR repeal that would include a 10-year freeze and a performance-based incentive program starting in 2017.

It remains uncertain how any permanent SGR fix, or another temporary one, might ultimately be approved this year, either as a stand-alone item or part of a larger budget bill possibly being worked out by a bipartisan budget conference committee.

It also is not clear where budget offsets might be found to pay for a permanent repeal. The Congressional Budget Office estimated earlier this year that it would cost about $139 billion over 10 years, which was lower than previous CBO estimates.

The views expressed in this document are solely the views of the author and not Martindale-Hubbell. This document is intended for informational purposes only and is not legal advice or a substitute for consultation with a licensed legal professional in a particular case or circumstance.

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